A Critical Appraisal of Strategic Action Plans

1032 Words Jun 16th, 2013 5 Pages
Michael Dell DELL -0.11% is making himself a pitchman for the $24.4 billion deal he says is needed to salvage Dell Inc.
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Color China Photo/Associated Press
Dell chief Michael Dell, right, visited a new manufacturing plant in Chengdu, China, on June 6.
The computer maker's chief executive has barely talked publicly about the proposed deal struck in February to take Dell private—a controversial transaction that has become in part a referendum on Mr. Dell's stewardship of the company he founded nearly 30 years ago.
On Friday, however, Mr. Dell laid out in an eight-page presentation to investors why he believes his company needs time away from the scrutiny of public shareholders to push through a corporate turnaround that
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If shareholders approve the buyout deal in a vote slated for July 18, Mr. Dell would own the majority 2of Dell's stock—giving him much greater influence over the company and its strategy than he has had. Now, Mr. Dell and affiliates hold roughly 16% of Dell's publicly traded shares.
It isn't clear that Mr. Dell's pitch will sway investors who feel shortchanged by the buyout. Some already have gotten phone calls from advisers working for Dell directors to urge them to vote for the buyout.
They will soon be hearing from Mr. Dell too, and likely from Mr. Icahn, who this week floated a proposal for Dell to stay public and buy back up to $16 billion in stock with the help of debt Mr. Icahn is seeking to borrow.
People familiar with the conversations with Dell shareholders say they believe they can win support for the buyout from a majority of Dell's stockholders. But the vote is complicated by Mr. Dell not being allowed to vote his stake for the deal, and by the continued pressure by Mr. Icahn.
Dell shares closed trading Friday at $13.35, down 1 cent. The stock price continues to trade below the $13.65-a-share deal price, in a sign market participants believe the buyout will clear the shareholder vote next month.
The presentation states that Mr. Dell would oppose an effort to borrow money and keep at least some Dell shares publicly traded, a type of transaction that Mr. Icahn

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